An attempt to discover if Mycophenolate Mofetil (MMF) can be of use when treating primary sclerosing cholangitis, the hardening of inflamed bile ducts (PSC). PSC is a progressive liver disorder characterized by the constriction of bile ducts. This results in the obstruction of bile flow within the liver and leads to cirrhosis (scarring). The underlying causes of this disorder are not well understood. However, the constricting process is thought to be based on immune distruction of bile duct lining tissue. This hypothesis is supported by the observation that many people with PSC have other coexistent autoimmune disorders and ulcerative colitis. Several immune suppressive medications have been studied for the treatment of PSC. These include prednisone, azathioprine, and methotrexate, all of little or no benefit. Mycophenolate mofetil (MMF) has been shown to be a strong immunosuppressant for use in solid organ transplant. A total of 30 patients who meet the eligibility criteria and have PSC will be treated in this study. They will be randomly assigned to one of two groups. The first group will receive the currently accepted PSC treatment of ursodeoxycholic acid (UDCA), a dose given according to body weight. The second group will receive the same dose of UDCA plus MMF. Patients will be treated for a total of 24 months. Liver function and enzymes will be tested at baseline, 1,2, and 4 weeks. Tests will be done at monthly intervals. After 24 months of treatment, all patients will undergo a liver biopsy to determine the results of the treatment.